The encoder market size is expected to reach US$ 6.21 billion by 2031 from 2.81 billion in 2023, at an estimated CAGR of 10.4% from 2023 to 2031.

By Geography the Encoder market is segmented into North America, Europe, Asia Pacific, Middle East and Africa, and South and Central America. In 2023, the Asia Pacific regions is growing with a significant growth rate. The encoder market in APAC is segmented into China, India, Japan, Australia, South Korea, and the Rest of APAC. Rising demand for advanced manufacturing technologies such as computerized numerical control (CNC) machines drives the encoder market. Encoders are commonly employed in closed-loop control systems of CNC machines to ensure precise movement and positioning during machining operations. They translate mechanical action into electrical signals that are processed by the CNC controller, allowing the machine to make precise cuts and motions in accordance with programmed instructions. Numerous industries across the globe are adopting CNC machines to automate their production lines, which increases the adoption of encoders to ensure precise movement and positioning of machines. For instance, according to Piran Advanced Composites data published in May 2024, CNC machines are highly used in aerospace, automotive, marine, medical, and renewable energy sectors to automate manufacturing processes. Encoder CNC machine"s ability to detect and correct errors, minimizing downtime and improving overall production efficiency. Without encoders, CNC machines struggle to deliver the high levels of precision and reliability demanded in modern manufacturing processes.

According to ANYbotics AG data, the government of Singapore organized the SPRINT Robotics APAC Summit to create awareness of the premier inspection and maintenance of robots and the benefits of using robots for automating industrial processes. The adoption of robots among industries surges the requirement of encoders to provide exact control of motors and actuators, allowing the robot to complete tasks with high precision. Thus, increasing awareness related to benefits offered by industrial robots and government initiatives toward the adoption of robots is fueling the market in APAC.

The Encoder market analysis has been carried out by considering the following segments: Type and Technology.

Based on type the global encoder market is segmented into linear and rotary. Rotary encoders provide feedback on the movement of a rotating object or equipment, such as a motor shaft, robotics, and machinery where rotational motion control is crucial. This type of encoder translates the moving shaft's angular position into an analog or digital output signal, allowing a control system to determine the shaft's position or speed. Rotary encoders can have shafts or consist of the thru-bore encoder design, which supports direct installation on top of a rotating shaft such as a motor. Thru-bore encoders are available in a variety of diameters and have clamp or set screw mounting options, making the device ideal for use in machine design applications. Flanges are used to place the encoder and prevent it from rotating together with the moving shaft.

Moreover, factor such as rise in demand from automotive industry and surge in product development by manufacturers propel the encoder market growth. Also, emerging usage of encoders in medical and healthcare devices is expected to bring new encoder market trends in the coming years.

Based on technology the global encoder market is segmented into optical, magnetic, inductive, and others. Optical encoders are the most precise of all sensor technologies. A rotary optical encoder comprises a light source, such as an LED, and a revolving disk with a pattern of opaque lines and alternating translucent slots. As the disk rotates, light flows through the translucent slot and is detected by a photosensor located on the opposite side. The photosensor provides a sinusoidal electrical signal in response to the presence of light observed in the translucent slots and the absence of light from the opaque lines. An electrical circuit then turns the sinusoidal signal into a square wave signal, which is made up of high and low pulses. These pulses are transmitted to a control circuit, which can count the pulses as the encoder rotates, allowing it to detect the location of the spinning shaft or perform an action based on movement or position. These encoders are often used in clean areas such as laboratories, semiconductor production, and other industries requiring precision.

Asahi Kasei Microdevices Corp, Vishay Intertechnology Inc, Sick AG, Honeywell International Inc, ROHM Co Ltd, Allegro MicroSystems Inc, Autonics Corporation, On Semiconductor Corp, Texas Instruments Inc, Analog Devices Inc, Microchip Technology Inc, STMicroelectronics NV, Broadcom Inc, OMRON Corp, and Panasonic Holdings Corp are among the key players profiled in the encoder market report.

The Encoder market forecast is estimated on the basis of various secondary and primary research findings such as key company publications, association data, and databases. Exhaustive secondary research has been conducted using internal and external sources to obtain qualitative and quantitative information related to the Encoder market growth. The process also helps obtain an overview and forecast of the market with respect to all the market segments. Also, multiple primary interviews have been conducted with industry participants to validate the data and gain analytical insights. This process includes industry experts such as VPs, business development managers, market intelligence managers, and national sales managers, along with external consultants such as valuation experts, research analysts, and key opinion leaders, specializing in the Encoder market.